Ibis Technology Announces Final Customer Acceptance of Oxygen Implanter; SUMCO grants final acceptance for their first Ibis i2000 implanter, while their second i2000 prepares for factory acceptance testing at Ibis

Business Wire, March 13, 2006

DANVERS, Mass. -- Ibis Technology Corporation (Nasdaq NM: IBIS), a leading provider of SIMOX-SOI implantation equipment to the worldwide semiconductor industry, today announced final customer acceptance of the Ibis i2000 oxygen implanter that was ordered by Sumitomo Mitsubishi Silicon Corporation (SUMCO), the world's second largest silicon wafer manufacturer. The implanter was ordered in January 2005 and shipped to that customer in Japan in June 2005.

Martin J. Reid, president and chief executive officer of Ibis Technology Corporation, said, "We are pleased that the SUMCO implanter has completed the final acceptance process, and we expect that SUMCO will begin using this tool for producing 300-millimeter SIMOX-SOI wafers immediately. This will provide an additional, highly qualified source of supply for SIMOX-SOI wafers to help satisfy the increasing demand."

Reid explained that final acceptance for this particular tool was delayed because Ibis agreed to hold the machine to a higher standard of performance for final acceptance in Japan than for factory acceptance in Massachusetts. "This gained significant ground on final product quality goals we had planned to reach later this year, but it took some time to accomplish. In addition, we experienced a disruption of the operation of the machine at SUMCO just as we were about to begin the final qualification runs. The delay was caused by a mechanical fault in a pressure sensor that caused a shutdown of the machine. The problem has been diagnosed and documented, repairs have been made and the tool now has successfully completed the final acceptance tests at the higher standard of performance."

SUMCO ordered a second Ibis i2000 implanter, as announced in October 2005. This second implanter now is being prepared for factory acceptance testing at Ibis. The two implanter orders from SUMCO followed on the heels of an implanter order from another leading silicon wafer supplier that was received in 2004. According to Reid, Ibis believes that these orders substantiate the Company's position that it is the world's silicon wafer manufacturers who are best positioned to meet the increasing demand for production volumes of SOI wafers for the global semiconductor industry. "Economics will drive the success or failure of SIMOX-SOI," said Reid, "and from our perspective, the economics should favor a supplier that controls the entire SOI substrate fabrication process, including manufacturing the starting silicon wafer that represents a significant part of the total cost of each SOI wafer."

Reid added, "It remains our goal to be the dominant supplier of oxygen implantation equipment to the world's wafer manufacturers so they can, in turn, be the most efficient and cost-effective suppliers of SOI wafers to the semiconductor industry."

SUMCO has requested that Ibis expedite delivery of the second implanter, which is expected to complete the factory acceptance process in the second quarter of this year, with final customer acceptance expected in the third or fourth quarter of this year.

As a result of SUMCO's final acceptance of their first i2000, Ibis plans to recognize revenue of approximately $6 million for this implanter in the current fiscal quarter, ending March 31. Revenue of approximately $7 million for the second SUMCO implanter will be recognized after final customer acceptance, which is expected in the third or fourth quarter of this year.

About SIMOX-SOI

Silicon-on-Insulator (SOI) refers to a substrate technology where an insulating layer is formed within a silicon wafer, isolating the thin top layer of silicon where the active transistors will be manufactured from the rest of the silicon substrate. The thin buried oxide layer acts as a barrier that can reduce electrical leakage from the transistors, resulting in semiconductor devices that are faster and more power efficient. These benefits make SOI a valuable technology for chipmakers producing IC's for high performance applications such as servers and workstations, portable and desktop computers, wireless communication devices, video game consoles and automotive electronics.

Separation-by-IMplantation-of-OXygen (SIMOX) refers to a technique used to manufacture SOI wafers where an oxygen implanter and an annealing process are used to create a very thin insulating layer within the wafer, just below a thin layer of silicon on the top of the wafer. Ibis believes that, compared to competing technologies, the SIMOX process offers high quality SOI wafers at competitive costs in production quantities.

About Ibis Technology

Ibis Technology Corporation is a leading provider of oxygen implanters for the production of SIMOX-SOI (Separation-by-Implantation-of-Oxygen Silicon-On-Insulator) wafers for the worldwide semiconductor industry. Headquartered in Danvers, Massachusetts, the company maintains an additional office in Aptos, California. Ibis Technology is traded on the Nasdaq National Market under the symbol IBIS. Information about Ibis Technology Corporation and SIMOX-SOI implanters is available on Ibis' web site at www.ibis.com.